Rural Expansion
Mobile services have indeed been the key driver of rural subscriber growth, but are service providers focusing well enough on rural subscriber growth?
With urban mobile penetration having reached levels of saturation, it is increasingly being recognized by the industry that rural pockets would be the next drivers of subscriber growth and also lay the ground for revenue growth going forward. With the changing demographic compositions making youth an increasingly large user segment, including in rural India, the potential of rural growth is here to stay.
As per TRAI, India had a wireless urban teledensity of 142.46 at the close of December 2014, compared to 138.94 the year ago. On the other hand wireless rural teledensity also rose marginally to 45.47 from 41.95, respectively, for the corresponding periods. The ratio of urban to rual teledensity in the case of wireless works out to the order of three.
Wireline urban teledensity, however stood at 5.60 at the close of December 2014, compared to 6.01 the year ago. The wireline rural teledensity, by comparison was 0.62 and 0.71, respectively, for corresponding periods. The urban-rural ratio in this case is an order of nine.
Mobile services have indeed been the key driver of rural subscriber growth, but are service providers focusing well enough on rural subscriber growth? Let’s look at some numbers.
Idea Cellular, which is the third largest operator both by number of subscribers and revenues, has long been known to be the most rural focused operator. Vodafone too has increased the percentage of its rural subscribers significantly and has the second highest percentage of rural subscribers, followed by Bharti Airtel.
Idea’s rural subscriber share was 55.31 percent of its overall subscriber base as of December 2014 as compared to 54.69 percent in December 2013. By comparison, the percentage of Vodafone’s rural subscribers came down to 52.47 percent in 2014 as against 53.69 percent the year ago. Bharti’s percentage of its rural subscribers, however, grew marginally to 45.90 percent in 2014 from 45.44 percent in 2013.
Other operators had far lesser ruralsubscriber percentages. Even state-run operator BSNL in December 2014 had 33.68 percent of its subscribers coming from rural areas, down marginally from 33.81 percent in 2013.
More strategic intent is required to accelerate rural teledensity, which at the close FY 2014-15 was at 48.37. (Of this, wireless accounted for 47.78 while wire- line made up for 0.59.)
The Digital India program can provide a key impetus, but the industry would need to identify the potential catalysts and build momentum around those.
Leveraging and promoting mobilegovernance instruments that have something in them to attract usage by the rural masses could be a way forward. An example could be the m-asset app that can be used to capture various assets available at gram panchayat level, including photographs and geographical coordinates. The app, which would also enable those assets to be seen on a map, could help citizens make panchayats more accountable and responsible for the common good. Already, a good percentage of rural youth is understood to be active on social media. That presence could be leveraged to create multiplier effect by building awareness around apps, content and other media that are of interest to other rural user segments.